HomeMy WebLinkAboutReso 42-1999RESOLUTION NO. 42-99
CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA
A RESOLUTION AUTHORIZING A SEPARATION AGREEMENT
WITH ENRON CALIFORNIA SERVICES, INC.
WHEREAS, on June 12, 1998 the City entered into three (3) separate agreements,
attached hereto as "Exhibit A" in order to implement the electricity aggregation plan; and
WHEREAS, it has become clear that it is not commercially feasible to offer significant
overall savings to the City's residents and businesses in light of unfavorable regulatory
structuring not anticipated when AB 1890 was enacted; and
WHEREAS, it is mutually agreed to withdraw from their collaborative efforts to offer
retail electricity to South San Francisco residents and businesses and to provide funding for
certain community enrichment program.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San
Francisco that the City Council hereby authorizes a Separation Agreement with Enron California
Municipal Services, Inc.
I hereby certify that the foregoing Resolution was regularly introduced and adopted by the
City Council of the City of South San Francisco at a Regular meeting held on the 26th
day of /.larch , 1999 by the following vote:
AYES:
Councilmembers Joseph A. Fernekes, Eugene R. Mullin, John
R. Penna, Mayor Pro Tem Karyl Matsumoto, and Mayor James L. Datzman.
NOES: None.
ABSTAIN: None.
None.
ABSENT:
City Clerk
C:~\ly Documents\RESO\enronres.doc
F~3M: ECT LEavit.
CONFH)ENTI~
RECITALS
Ao
The City and ECMS a~e parties to a btunicipal Utility Services Agreement
dated June 5, 1997, (the "MUSA"), purs'oa~ to which ECMS (th~n ]mown as
First, Point Ctlifomia, Inc.) w~s select~l by the City to provide services m t~e
newly competitive mnrket for elec~city in the St~ of C~lifomia.
On or about Ame 12, 1998, the City ont~ed into three scp~'at¢ ~crccments
in order to ~pl~t the el~mci~ ~on p~ s~ ~ m ~e ~S~
~ ~n~ c~i~ ora ~l S~ S~ces ~~t ('~SA")
~ a ~ial ~~ A~t (~") ~th ~CMS, aM a Pow~
ECMS au~o~ by t~ F~ ~ Re~.at~y Co~i~ ~o sell
w~l~e ~l~c energy,
C°
In the course of offering electrical servicc~ to the City's msicleztts ~d
businesses, it has become clear t~ it is not commercigly feasible to oiler
significant over~ll savings ~o r~ Cit~'~ re~idenu and businesses m light of
¢ON1UI)ENTIAL
unf~vo~bk ~¢galmory stru~ nm .,,ticipazed when AB I~90
electricity r~stru~t~ng le~islagon) was
In light of the unf&vorabl~ t~~ and market conditions, tile City alacl
£C'M$ desire to ~ermm~te tb~ MUSA, ~e R~$A ~cl the FAA, to m~aally
wifl~l~w from thdr colbbordlivc effo~ to offer rcUJl electricity to $ouOt Sen
Francisco residents and businesses and to p~o~id~ funding for ~ community
· mi~ programs on ~h¢ tmna md condilions set forth below.
NOW, 'I'HER~FO~, the parties hereto agree as follows:
1.0
l'~raklstion of A~'r,~.e.9{s. Eff'.ctiv. upon ~ ~te of ~s ~~ ~ Ci~ md
~S ~ ~ d~ to bye pm~d~ ~e ~ t~ thc ~SA, t~ ~SA ~
~. F~ ~ ~,~on, ~e City ~i~. ~, ~ ~ ~, pmvi~ nofi~ ~o ~e ~c
PP~ ~ eff~ve ~ of t~~ of~ ~S~ t~ F~ ~ the PPA shil ~ ~
~c ~ w~ch a~ to ~ customc~ ~S~ ~ Frmci~o U~ Sol~o~ shall
2.0
In addition, ECMS shall make payments provided tn Section 3.0, below.
3.0
Termination of Customer Contracts. '1~ City and ECMS ~h,ll coopc~t¢ i~
terminating all o~mnding co~'.ts bct, een the City (through South San Frm~sco
Energy Services) and its ~lectricity cus~om~s. ECklS shall pay to cu~omcrs whose
accomlts ~'¢ t~'lninat~d the following amotlnts:
3.1
For resideraial customers who h~vc signed sa'vice Contracts with South
Francisco Energy Scrvice~ as oftbe date of thi~ ~ecmcrtt. an amount equal to the
~ or' (a) $60 or (b) two mont~s' average aeetrica~ crier&-/usage (based on
historical data lYrOvided to ECM,g in conl~clion with Ihei~ ~crvic~ applicatjoR) at
th~ ra~ currmtly provided ~nder ~dr reegective service conzr~ts.
For conm~rcial customcrs who sro r~ ~cx~ ~ ~ of~ ~e of
~is a~m~ m emomt ~ to mo mo~' av~a~ el~ ~gy ~ge
~on) ~ ~e ~e c~y pw~ ~ ~c~ ~p~fi~ ~ ~.
For commercial customers wlM have signed service contracts with South San
Francisco Enorgy Services, btu ~ ~'~ not yet receiving ¢learicity sen, ice ts o~
CONFIDENTIAL
the date of this ~r~mel~. ~n amour ~lual to o~ month's a~ eleclric~l
eoer$.y usage (bas,el ou hi,riehl d~ta provided to ECMS in co~ection with their
servic~ al~tica~ion) a the rate ctu. matly l~vid~i under their respective service
3.4
For each customer who is r~ceiving electricity service as of the date of tl:u
agreement, reimbursement of the actual, o~t of pocket amount (if ~y), exclusive
of ~nouats charged ~s d~posim or similar ~ym~nt~ or with respect to meters
~ other hardware, paid by s~lCh ~m~r £or e~tnblishing ~quival~t se~
wxth anofl~r ~n~gy s~ic~ pzovid~; noz to exceed the amount that .~o~d ha~o
~ ch~ge~ ~ such smvice beea re-established w~th Paeit~c Gas & Electric.
Paymellts shall be made ~o customers witl~ lea (10) days following thc eff~.-tive
termirtation date of theiz rea'pec~ive nccotm~, ~I may tal~ the form, i~ ~lmle m' in part,
o! offs~s qainst smotm~ other&ise due from the c~om~t.
4.0
cooperate to l~epar~ and distn'bute mutually, securable press releases (if dee. m~
approprmt~ by both pmlies to make seth pres~ releases) ~1 comm~mk~io~ with
cut~ome~ re~arding thc p~rties' dc~ision M withdraw from providing the s~',ric~s
~pll~xi in the MUSA.
5.0
l~lense of Cl'ims. In consiAe~on of d~e l~?ment of ~s ~ ~~ of
~ r~ &e other for ~y and ~1 cl~, ~, Io~. i~g~ ~ a~
6.0 MfSCI~.~,lr.ANEOUS.
6.1
I)daul~ and Ri~t to Cnr~ Failure or d~hy by eith~ ~ m ~y p~o~
o~y ff~e ~ w~ M f~ or ~liys ~ not c~ce to ~o, ~, or
r~edy s~h fail~e or delay ~i. ~ (30) ~ys ~ ~ ora ~
notice ~ci~ s~h f~l~e or ~hy, ~ ~ ~t ~~ ~~ su~
c~e, ~o~ or ~y ~ dfig~ce to ~mpl~on. ~e ~ p~ ~
~hiu~ o~by the m~ p~, Exe~ ~ reqar~ to ~ s~ ~
~l~. ~e ~ p~ may ~t ~ ~e~a~ ~i~ ~ p~ m
6.2
Dtsoute Resoltl~jon. All claims ami disputed bctweert ~ City and ECM$ m'ising
out of or r~l~d to this Agreement will flrs't be artempt'~l lo be r~olved by the
materially, s~mior managemeM for bo~t the City and EC~I$ will-negotiate i~
~-~~99 16:57 ~'RI3~:FCT LEF~L ~T. ~-~-__~_ TO,9$SI~3~144~i ~:l~
COWI~IDENIIAL
good faith to zeac~ an acceptable and timely re~ol~Uon of the clabn or dispute.
Should the pames be un~blc ~o resolve l~e ~is~ut¢ to th~ mutual ~atiffac~ion
within two (2) weeks ai~ ~ch negotiafioa by stz,_ior mau~g~t, or ~y other
mutually agreeable tim~ period, the p{~tie~ ~ attempt tO resolve the di~ut~
through rion.biudini{ mediation (usiag a mediator upou which the partes shall
mutaally agr~ wilhin thirty (30) days), as a ¢ondilton prer. edent to pmsui~
litigatiou. Neither parry shall be obligated to ,mgag¢ ia mediaiiou for iouger ttum
two (2) w~e.k~ Elgh patty will be tg~motm'ble for its owu expeasea {mxl o~e-half
of any mediatiou ex-peases iucurred to resolve the dispme. [f~e parties ~e still
unable to :,esolve their differences alter good fai~ comideratiou of are. solutice
~mu~ mediatiou for a period uot to exceed two (2) weoks, each party will have
thc tight to puzsue litigmiou in aecoulauc~ with the provisious set forth below.
Neither party may commeace my actiua at law o~ in ~quity as a result of auy
aisput¢, ~onUov;rsy or claim arisiag out of or in ¢onncctio~ ~ith ~ rclatillg to
this Agreement or any breach or alleged bre4c, h l~reoir uatil the above pr~
with respect to seulemeut ;md medimoa bare been complied ~vith.
6.3
Based on ih¢ forcgoiug, tbe parties waive
~y cl~ for 1~ o~ d~e for
u~ ~n, "claim" i~i~d~
~r ~ ~d~L or
~~. No ]~al ~ ~1 ~ ~le for a ~h of ~ ~s ~f
~ ~ ~le ~ excl~ve :~y sBall ~ ~ ac~on for ~ific ~ffo~ or
~l~to~ or ~five ~li~t No~ ~ ~c forego~ ~e is Judea to
p~m ~e Ci~ ~om re~v~ng m m~ d~ag~ on ~If~i~ff ~ts
o~g ~ ~ S~ou 2.0, ~ on b~alfof ~om~s of Sou~ Sm Fr~
~ s~c~ ~omls o~ p~
~Y ~ST OR PROSP~I~ PI(,~ OW A~ O~R SP~, ~UNiTIVE,
TORT, ~oN~ O'R ~~) ~ OR ~P~ Of ~8 A~~ O~
FOR A~ F~ O[ P~O~ ~D ~O ROW~EVER ~U~.
W~ OR NOT ARI/~O ~OM ~T P~TY'S ~.LE, IO~ OR COUNT
~NCE.
6.4
Fees. In the event ofauy disput~ resulting i, }i~gafi~ b~we~ ~
hc~ ~vol~ t~ ~v~ ~ ~o~ C~ ~ ~is A~t
om of~c ~bj~t ~ ~ ~e A~menL ~c ~g~ ~y ~ bc
r~over, ~ ~e ~ ~ ~ ~ pay, ~1 r~nable ~, ~
~l~g but uo~ Hmit~ m aU~' fe~ ~ ~ ~ ~ ~ ~p~l.
§ d §I0~01098~'0N/~0:~I'£S/~0:~I
f~R-L~5-99 16:57 F~"fq:ECT L~F_~L D~PT. ~-4~/J-~5~J T0,915183~14481
CONFIDENTIAL
6.5
Notice_.___, Unless otherwise provided for beacon, ~y ~o~c¢ to be ~v~n o~ o~
d~umcnt to ~ deliv~r~ by ~ p~ to the oth~ h~c~ ~ ci~r ~
dehv~ m ~n ~ s~h p~ or m~ ~ ~si~d ~ ~e U~t~ S~ ~
d~y ~fi~ Or re~st~ or ~ ~k ove~ de~v~ s~, ~
~s~ge p~, ~~ m ~e p~ ~r whom mte~ ~ fo~ow~:
To the City:
The City of 5outh San l:nnc~.o
400 Grand Avenu~
Sour~ Sm ~i~o, CA ~80
Copy to:
City of South San Fmuasco
400 Caaud Avenue
South San Francisco, CA 97080
Arm: City Attorney
Telephone: (650) $T'/.8515
Fax: (510) 351-4481
To I~CMS:
ECMS California, lmm.
1400 Smith S~eet
Houston, TX 77002-7361
Attention: Mie. h~l McDonald, President
Telephone: (?13) g$~{-1932
1~acsimile: (713) 64~-3037
Either patty may from time to t~ne, by written notice to the ot~ers, designate a
different add~ess which shall be substituted for thc one above epecificd, and/or
specify additional partie$ to bc notified. Notwitiistandin$ anything to thc contrary
hereto contmned, ~y notice~ or documents which may ~e delivered by mall
putout to tl~s Section 5.6 must be actt~y delivered to 1~¢ otl~r pazry on the
last business day immedately preceding a~¥ deadhne date specified i~ this
Agrccmcnt.
6.6
~. ECMS shall have no fight to a~ign this A~teement
~l~e E~S mi~t h~e ~ ~ ~mt
~ae, ~out the prior ~ c~ of ~c Ci~, w~ch
~cld ~ ~e Ci~'s ~lc ~d absolut~ diskfit. ~y ~c~t by ~CMS W
m~e an ~si~ent o~ ,k~ ~ ~ ~e
~ n~l ~ vmd ~ s~1 conic a b~ of this A~t. ~ ~e e~ of
~ent. ~e CiCa ~ ~ ~ ~c~t by E~ ~1 ~1 ~ev~
E~S ~ ~ obhg~o~ ~ ~ i~t.
~m~t nor my Mt¢~ ~ may ~
MAR-~5-~9 16:~8 FR[IM:ECT L~I~I~L DEPT, 5~-~164-81~ TiD:91~lI~144BI
CONI~DENTIAL
hypothecated, or encumbered voluntarily or by op~-.,tion ofl~w, whctbe~ for the
bene/it of creditors or otherwise, without thc poor written approval of the City.
Tvansfe~ wifl~n the Emon f~rnily of compmics shall nm be restriotod hermmder.
In thc ~eat of any such unspprovcd tnms~, including any banlcruprcy
Irreg. ~his Agreem~t ~h/fl! ~ void.
6.7
~'-ntire ~r~ement. This Agreement conttlne the entire agreement of the patties
hereto with respect to the matt~ covered hereby, arid all negotiations and
aglzem~-ltts, ~l~tcmerits or prozrgs~ b~twecn thc paa-,¢s hereto or [heir agohts with
respect ~o ~his transaction ar~ merged ~ this A~re~t~t, which alon6
the partie~' r/ghu and obligations. ~mi if not contained horoin ~I1 not be bindi~
or valid a~inst either of thc pmi~s
6.8
Modifie~lion. Amy amendmonts or moditcatio~s to this Agreement must be in
and cxecutcd by Ix)th parties to this Agre, cmem.
6.9
6.10
No Waiver. No delay or orm~ion by either party hereto in cxercising any ri~t
or pow~ accruing upee. the con!pli~ce or fa/J~e ofperfo~ce by the other
paA3' hereto raider the provisiot~ of this Agrvemont shall impair any such right or
power or h6 construed to be a waiver giereof. A waiver by either party hereto ora
breach of any of the covmants, conditions or sgreemenls hereof to be performed
by tho party shall not be consmMd as a wa/v~ or'any sue, tong breach of the
sam~ or other covenants, a~reem~ rc~tiom or conditions lhereot
6.11
SeverabiliW. Ir'any term, provision, condition or covenant of~his Afg~'men! or
the application thereof to ~ither parry or cu'ctlmsl~nc¢$ shall, to any extent, be
h~.ld invalid or mlelxfo~ceab]~, th~ rcmaindor of this instmmelll, or the applic.~iol~
of sllch ~ provisimt, co~lditiolt or oov~umt to persons or ciwumata~ces othe~
than those a~ to whom or which it is hid iavaJid or unenforceable, shall not be
afJ~ted thereby, and each term and provision of this Agr~ment s~all be valid and
onforccablc to the fullest extent permitzed by law.
6.12
Authori~ to Execut~ Each individual executing this A/reement on behal/ofa
party represents and warrants tha~ he or ~ho is duly authorized ~0 cxccme and
deliver this Agreemc~lt on behoof stl~h l:mty, that all conditions to thc cxerci~c
of such authori~ have boea satisfied md ti~ :his Agreement ,,viii be bin~g upon
such entity in accordance with its tams.
CONFLDENTIAL
6.13 Counteroar~. ThisAgteement, ineludinganyexlgbitsattaehed~etomayb,
e~ecut~t by the p~mies ~eteto in ~ev~al counterpam, each of which ~ be
d~'mod to be ~t original copy.
6.14
Caigiom ned Headings. Tho captions alxl headings of this ~e~t ~ ~r
c~v~c o~ ~ ~1 n~ bc ~ ~ refe~M to m ~l~g qu~o~
of mt~ion or cons~c~o~ ~y R~s ~ fo~ ~ ~ ~nmg of ~
A~e~ ~c conUac~ ~ ~1 ~ ~~ or refe~ m ~ ~olv~g
6.15
I~I~JejW, ~CMS and ~e C~ty shah coordinate wi~ respect to any press retenses
or pobUcity rolated to tl~s A&rcement ~nd ~ bus/nc-ss rela~*o~ps created
he, em eXcgpt fo~ gc~a~a'~ public filil~S and mlea.~es wluch dL~u~s bl~dly
agrc~n~s of this nattu~ nnd exce~ for leg~ly required disclosures.
6.16 No !'bird-Party Senef'gtari~. This Agr-,nment shall not lnt=e to the Ina, fit
not be eafor~eable by, nny person o~= than t~e City zod IiCMS.
IN wI'rN~SS WHEREOF, the parties hereto hav~ execeted this Retail Support Se, vice~
Agreement thc day and year fi~%-t above wr/tmn.
"The City"
T~e City of$omh S~n Frauci~co
Approvud as to fom~:
Stevta T. Mnnas
City Auomo,
"ECM$"
F, nmn Califomis Municil~tl Services, Inc.
By:
Michael M~Domld, I>rcsid~nt